Oil Sinks a Second Day With Delta’s Spread a Menace to Demand
- China’s latest outbreak may erase 5% of short-term oil demand
- Tanker incident off Oman prompted some buying on the complex
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Oil declined for a second day as the spread of Covid-19’s delta variant in China threatened to disrupt the recovery in global crude consumption.
West Texas Intermediate futures ended Tuesday’s session down 1% at the lowest closing price in almost two weeks. Nearly half of China’s 32 provinces have been gripped by the latest outbreak in Asia’s largest oil market, with 5% of worldwide short-term oil demand potentially at risk, according to calculations by China National Petroleum Corp. The price drop was tempered somewhat by a rally in equities trading and the “potential hijack” of a ship in the Gulf of Oman.